Mahindra Satyam announces first results since scandal

Indian IT services firm has announced two years of financial results, but still failed to meet NYSE requirements

Mahindra Satyam will delist from the NYSE

Mahindra Satyam, the Indian IT services company, today released its first financial results since the ‘Raju scandal’, where former chairman Ramalinga Raju admitted fraud and falsifying accounts in January 2009.

This follows the organisation's announcement last week that it would delist from the New York Stock Exchange (NYSE) because it had been unable to meeting its financial reporting requirements.

Mahindra Satyam chairman Vineet Nayyar said at the time: “Owing to our late SEC filings, which are among the unfortunate results of the misdeeds of former management, we are delisting from the NYSE.”

The company today revealed that revenue in 2009 fell from £1.2bn, to £772m in 2010. However, loss after tax was reduced from £1.2bn in 2009 to £17m in 2010.

It is understood that the extent of the fraud is at least partly responsible for the loss figures.

Despite today’s release, the organisation remains unable to meet its financial reporting requirements fully and that the ongoing investigation into the fraud has contributed to the reporting delay.

The company was required to submit its annual report for the year ended March 31, 2009 by October 15 2010, but has admitted now that it will be unable to meet that deadline - it represented the maximum permissible time frame.

The company had missed several previous deadlines.

Sandeep Thawani, head of marketing and communications at Mahindra Satyam, said: “It was evident to us that would not be able to achieve that deadline, given that we have supervised access to our accounts now. All our statements, accounts and underlying data is under supervised access from the investigators.”

Thawani was keen to state that the company is still trading in the US: “We are still trading in the US in the over-the-counter exchange and we have protected shareholder interest completely,” he claimed.

“Operationally and financially it has no impact on the company.”

When asked if delisting would affect confidence in the company, Thawani replied that it was too early to say.